Autonomous retail startup Standard Cognition raises $40 million in Series A funding
AI machine vision retail payments startup Standard Cognition[https://standard.ai/] has raised $40 million in a Series A funding round, and plans to hire 70 to 80 employees to speed up its deployment to more partners, TechCrunch reports.
The funding round was led by Initialized Capital, with participation from CRV, Y Combinator, and Draper Associates. Standard Cognition was launched a year ago, and has raised $11 million in seed funding, grown to 40 employees, and launched a 1,900 square-foot test store in San Francisco in September, which uses only 27 cameras, compared to hundreds for Amazon Go. Based on conversations between Co-founder Michael Suswal and TechCrunch, could be currently valuated at $160 to $200 million.
The company’s technology identifies shoppers based on their shape and movement, rather than facial recognition, which has driven most retail biometric schemes, including the Amazon Go store. A mobile app for iOS or Android flashes a light pattern to in-store cameras to associate the shopper with a certain account and payment method, allowing shoppers to bypass the checkout stage, or they can shop without the app, and visit a kiosk where cameras identify the purchased items before a traditional card-based payment.
The system is 99 percent accurate at identifying people, the company says, and is trained to identify suspicious movements and shoplifting.
Standard Cognition’s seven founders met working at the SEC, and decided to attempt to address the market for automated payments in retail right before Amazon announced the launch of its Go stores, according to TechCrunch. The founders eventually decided this would be a good thing for their project, as it would drive other retailers to innovate to compete with Amazon.
Other autonomous retail startups include Zippin, which has a store in San Francisco, Inokyo, which has a pop-up shop in Mountain View, and Trigo Vision, which provides technology for a grocery chain in Israel with 200 stores. Standard Cognition has four retail partners, three of which do not want to be identified, but TechCrunch reports that they are U.S. grocery, drug store, and convenience store chains. The other is Japanese pharmacy chain Yakuodo, for which Standard Cognition will begin installing cameras next month. The system Standard Cognition is providing the pharmacy chain also works with cash, since 70 percent of transactions in the country are still made that way.
Suswal says the Japanese labor market makes it difficult for retailers to staff their stores, and also noted that with increasing labor costs in the U.S., Standard Cognition’s technology could make more retailers viable for survival.
Retailers deploy the system by purchasing cameras and a computer from Standard Cognition, and then paying monthly service fees based on the store size, SKUs, and product changes.
artificial intelligence | identity verification | investment | retail biometrics